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What's Going On With Alibaba And Its Chinese Peer Stocks On Friday?

Published 12/04/2024, 15:29
Updated 12/04/2024, 16:40
© Reuters.  What's Going On With Alibaba And Its Chinese Peer Stocks On Friday?
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Benzinga - by Anusuya Lahiri, Benzinga Editor.

Alibaba Group Holding Limited (NYSE:BABA) and peers are trading lower Friday amid reports of China retaliating against U.S. semiconductor sanctions via the East Asian country’s latest move.

In 2024, Chinese officials directed major telecom carriers to phase out foreign processors, notably impacting American chip giants Intel Corp (NASDAQ:INTC) and Advanced Micro Devices, Inc (NASDAQ:AMD).

China set the deadline for 2027. Intel, with China as its largest market, and AMD saw a revenue reduction from China following U.S. restrictions.

The Wall Street Journal reports that China commanded its telecom operators to inspect their networks for non-Chinese semiconductors and plan their replacement.

Also Read: Alibaba’s Jack Ma Backs Company’s AI Push and Restructuring

Alibaba rivals Baidu, Inc (NASDAQ:BIDU), JD.Com, Inc (NASDAQ:JD), and PDD Holdings Inc (NASDAQ:PDD) also traded lower on Friday.

Alibaba has slashed its cloud service prices significantly, offering discounts of up to 59% internationally, in response to competitive pressures and U.S. sanctions impacting the technological capabilities of Chinese firms, including Alibaba itself.

This move follows a price reduction initiative within China, where Alibaba cut prices by up to 55% for critical cloud services, sparking a price war with rivals like JD.com.

According to Alibaba co-founder and chairman Joe Tsai, the U.S. sanctions have disadvantage Chinese tech companies, including Alibaba, in AI development and high-end computing services by restricting access to advanced semiconductors.

Despite these hurdles, Tsai mentioned efforts to seek alternatives and develop large language models in-house to ensure the competitiveness of Alibaba’s cloud offerings.

Price Actions: BABA shares traded lower by 1.86% at $73.46 premarket on the last check Friday. BIDU shares traded lower by 3.13% at $72.51, JD shares traded lower by 4.96% at $25.65, and PDD shares traded lower by 2.30% at $118.34.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Image via shutterstock

© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

Read the original article on Benzinga

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